YourABA: October 2012
YourABA October 2012 Masthead

The inside scoop on successful lawyering, in-house and out

Mark Herrmann

Mark Herrmann

Mark Herrmann is perhaps best known for his “Inside Straight” column on the popular legal blog Above the Law. Hermann, chief counsel at the insurance brokerage Aon, brings humor and practical advice to his column, and now he shares his wisdom about working as both outside and in-house counsel in a new book, also called Inside Straight.

Hermann offered choice insights from the book for readers of Your ABA:

What are some of the most significant challenges of moving from outside to in-house counsel? Are there tips you might offer other lawyers based on your own transition?

Corporate clients often ask law firms to consider difficult legal issues that the corporation’s law department doesn’t have the time or resources to analyze on its own. Lawyers at firms then research those issues carefully, analyze the issues in depth and provide a carefully reasoned response. Life in-house is different: A business unit has a question and needs an answer — now. The business is relying on lawyers to have good judgment about legal matters and the ability to act quickly and decisively, sometimes on the basis of incomplete information. A lawyer who moves from a firm to a corporation should recognize that the lawyer will now live in a very different environment.

Also, lawyers at firms are the center of attention: Law firms wallow in the law, and lawyers are the source of all revenue. Corporations, by definition, are wallowing in something other than the law. They wallow in pharmaceuticals, or real estate, or technology. A lawyer who moves from a firm to a corporation thus changes from a hallowed revenue generator to a tolerated provider of internal support services. That concept is easier to express in words than it is to understand deep in one’s soul, but it’s an important distinction between in-house and law-firm life.

What are the differences to be aware of in terms of how you are compensated? Are there greater advantages or disadvantages to being in-house in that area?

As a general matter, compensation at law firms is easy to understand: As an associate, you will receive X dollars in salary, and perhaps a bonus, annually; as an equity partner, you will receive Y percentage of firm income, which amounts to Z dollars if the firm performs at 100 percent of budget.

At corporations, compensation is different. You will be paid a base salary, which is likely to be less, perhaps far less, than the annual salary at a firm. You will then be given a target bonus. You may be paid more or less than the target depending on how the corporation, the law department and you personally perform during the year. And, depending on your job, you may also be awarded some form of stock that you will receive over time. When the stock award vests, it may be worth more or less than it was at the time you were given the award, depending on the company’s financial performance.

It’s hard to provide any general rules about whether you’ll be better compensated at firms or corporations. There’s a perception that lawyers leave firms for corporations to accept less pay in return for a better work-life balance. That may be true for some people, but it is surely not true — in terms of either pay or workload — for everyone. Before you accept an in-house job, you should decide what you want out of your work and life, and you should ask hard questions to be sure that you’ll receive what you hope for.

Now that you’ve moved from outside to in-house, has your view on outside counsel changed? What’s an example of an insight that you have gained that might be able to benefit outside counsel?

Two things: First, as outside counsel, I thought that I had achieved a great deal by having lunch with, or getting a meeting with, an in-house lawyer. Once the in-house lawyer met me, he was sure to want to hire a person as clever and pleasant as I was. As an in-house lawyer, I now understand that in-house lawyers routinely have courtesy meetings with outside lawyers — as a favor to someone in senior management who asked the lawyer to have the meeting, simply to make the outside lawyer stop pestering about having lunch, whatever — and the first meeting only marginally improves the odds that you’ll ever get business from that client.

Second, the most helpful outside lawyer is the one who proactively alerts inside counsel to important events in the life of the in-house lawyer. Those alerts don’t have to be frequent or long; they just have to be good: “In case you missed it in this morning’s news, a regulator smacked your key competitor with a $10-million fine yesterday.” Or: “A state supreme court issued an important decision yesterday. The upshot is that your company should proactively do X, Y and Z. If you want to read the whole opinion, I’ve attached a copy for your information.” The key is to convey what matters to the in-house lawyer, not to write about your recent victories or to wallow in long, descriptive paragraphs meant only to impress a reader.

A chapter in your book is devoted to attracting business. If you had to pick the most effective way of doing so, what would that be and why?

How do you generate business? Get famous; make contact. You get famous by practicing, speaking and writing in a particular field of law and participating in groups that focus on that field. You make contact by staying gently in touch with people you meet, perhaps by sending them occasional emails to alert them to items that may be of interest. Do those things for a decade or two and somehow, mysteriously, your phone will start to ring.

Certain specific business-development tools are underutilized. Consider offering complimentary, high-quality continuing legal education courses that you’ll present at a client’s place of business. Invite in-house lawyers to attend, serve sandwiches for lunch, and arrange for in-house lawyers to get CLE credit for attending. Those events let you meet and, if you’re good, impress in-house lawyers in small groups. Also, too few lawyers offer to co-author articles with in-house lawyers. Working with someone to write an article gives you a chance to impress your co-author, up close and personal, with the quality of your analytic and writing skills.

Can you explain what you mean by “outer directed” and why it should be important to lawyers, whether they are in-house or outside counsel?

“Inner directed” people aim to impress their colleagues: Associates or junior partners devote their time to sucking up to their senior colleagues, trying to curry favor with them. That approach may help a person advance within a law firm, but that conduct doesn’t help the firm as a whole succeed. “Outer directed” people aim to impress the world: They write books and articles, teach classes, serve on the boards of nonprofit organizations or bar groups, and otherwise raise the collective profile of the firm. Outer-directedness helps the firm immediately and, with luck, will help the individual over time: If you impress the world sufficiently, eventually the firm will be impressed, too.

You talk about poor (or blank) email subject lines. Can you give some advice on how lawyers can craft more effective email communications?

Think before you press send! If you received an email notice from the court with a subject line that reads: “Case No. CV-12-3232,” do not simply forward that email to the client. The client hasn’t memorized the case numbers of all outstanding matters, and the client has no idea what you’re sending or the priority it deserves. Change the subject line to read: “Ackermann: Summ jdgmt granted!”

Add some text that says we won summary judgment on X ground, that the money quote from the opinion reads Y,” and that the other side has 30 days, or until date Z, to appeal.

If you’re trying to communicate with someone, pause for a minute before sending an email to be sure that you’re actually conveying relevant information in a useful way.

Your book gives some rules on delivering bad news to clients. Can you select perhaps what you feel is the most important of those rules for lawyers to keep in mind?

How would you deliver joyously good news to a client? You would pick up the phone and call, so that you and the client could enjoy the moment together.

How must you deliver painfully bad news to a client? Precisely the same way that you’d deliver good news.

News is either urgent and important or it isn’t. If the news is urgent and important, then deliver that news in an appropriate way. The form of delivery is driven by the importance and urgency of the message, not by whether the news is good or bad, or whether you personally will enjoy delivering the message.

Finally, do you have a favorite piece of wisdom/advice you’ve gotten from a reader(s) of your column? What is it, and why does it resonate with you?

Blogging is a wonderful way to communicate with the world. And I’m fortunate to be writing my column at Above the Law, which is one of the most widely read legal websites in the world. That means that I get an awful lot of immediate feedback on each column, as “commenters” post reactions to what I’ve written and other folks in the blogosphere react and link to my columns. When I assembled my columns into book form [in Inside Straight], I tried to give readers a sense of that experience. I included comments that ran the gamut from, basically, “Screw you, Herrmann, and the horse you rode in on,” to very intelligent thoughts about how, for example, law firms and corporations could change their interview processes to attract and hire better people. I can’t pick my favorite comment — that would be like Sophie’s Choice, wouldn’t it? — but I’ll say that I’ve enjoyed the blogging experience and, since I have a thick skin, I’ve appreciated all of the responses.

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